Equipment Cost Glossary
Plain-English definitions for common equipment loan, lease, operating cost, maintenance, downtime, and lifecycle planning terms.
| Term | Meaning |
|---|---|
| Amount financed | The equipment price plus financed fees and entered costs, minus down payment, trade-in, or credits. |
| Amortization | The process of paying down a loan balance over time through scheduled payments. |
| Balloon payment | A larger amount that remains due at the end of a loan or finance term. |
| Buyout | An amount paid at the end of a lease if the agreement allows or requires purchase. |
| Cost per hour | A planning estimate that spreads fixed and variable equipment costs across use hours. |
| Downtime | Time when equipment is unavailable and may cause lost output, labour waste, delay, rental needs, or rush repair. |
| Lease | A contract allowing use of equipment for payments over a term, often with return or buyout conditions. |
| Resale value | A rough planning estimate of what equipment might sell for later, not an appraisal. |
| Total cost of ownership | A broad estimate combining acquisition, operation, maintenance, support, downtime, finance, and resale assumptions. |
| Utilization | The percentage of available time or hours that equipment is actually used. |